A survey revealed - today, Wednesday - that the activity of the non-oil private sector in Egypt fell last June to its lowest level in two years, with demand affected by high inflation, weak currency and lack of materials.
The Standard & Poor's Global Purchasing Managers' Index (S&P) in Egypt fell to 45.2 from 47.0 in May, moving away from the 50-point level that is the difference between growth and contraction.
And last June was the 19th consecutive month in which the index recorded a decline.
“Egypt’s non-oil economy recorded its weakest performance in two years in June, as companies witnessed a decline in demand in the face of a sharp increase in prices, depreciation of the pound and shortages of materials. This reading is the lowest since June 2020 during the wave,” Standard & Poor’s Global said. The first for the COVID-19 pandemic.
Standard & Poor's reported that the manufacturing, wholesale and retail sectors were hit hard, core inflation increased to 13.5 percent in June from 13.1 percent in May, and the sub-index for production prices increased to 72.0 in June from 62.1 in May. , while the purchasing cost index rose to 70.9 from 62.3 points.
"Supply conditions also remained weak, adding to inflationary pressures as companies threatened to make it more difficult to provide raw materials," said David Owen, an economist at Standard & Poor's.
Production and new orders in June continued the contraction that has been going on for nearly a year, as the production index fell to 41.3 from 45 points in May, while the new orders index fell to 41.9 from 44.6 points.
The sub-index for future production expectations also rose to 63.7 points, the highest level in 5 months, compared to 55.2 points in May, when it approached the lowest reading since this category was included in the survey 10 years ago.